Jaguar Land Rover (JLR) is exploring a potential partnership with Chinese automaker Chery to manufacture vehicles at its UK facilities, according to recent reports. The move comes as the British government actively seeks to boost domestic car production, aiming for 1.3 million units annually by 2035, a significant increase from last year’s 738,000.
Government Support and Trade Negotiations
Discussions between JLR and Chery are being facilitated by the UK government, with Prime Minister Keir Starmer currently engaged in trade negotiations in China. This initiative reflects a broader strategy to attract foreign investment and revitalize the UK automotive industry. The government’s willingness to engage with Chery contrasts with the European Union, which recently imposed tariffs on Chinese EVs due to concerns over unfair subsidies. The UK opted not to follow suit, citing a lack of formal complaints from local manufacturers.
Chery’s Global Expansion
Chery has been aggressively expanding its manufacturing presence outside of China. In 2024, the company acquired a former Nissan factory in Barcelona, and recently secured a deal to purchase Nissan’s plant in South Africa. This demonstrates Chery’s ambition to establish a global production network, potentially leveraging JLR’s UK infrastructure.
Market Dynamics: Chery’s Rapid Growth in the UK
Chery’s brands—including Jaecoo and Omoda—have seen remarkable growth in the UK market. Jaecoo sales surged from 209 units in 2024 to 28,232 in 2025, surpassing established brands like Honda, Seat, and Citroen. Omoda experienced similar success, increasing sales from 3,629 to 19,855 units, outpacing Suzuki, Jeep, and Fiat. This rapid market penetration highlights the increasing competitiveness of Chinese automakers in Europe.
JLR’s Challenges and Strategic Shift
In contrast to Chery’s success, JLR faced setbacks in 2024, including a prolonged cyberattack that shut down its UK manufacturing sites for over a month. The company also underwent leadership changes, with CEO Adrian Mardell retiring and being replaced by PB Balaji, Tata Motors’ CFO. JLR’s partnership with Chery dates back to 2012, but Chinese production of Jaguar models ended in 2025. Future models will be based on Geely’s EV platform under the spin-off Freelander marque.
Potential Obstacles
Despite ongoing discussions, a deal between Chery and JLR is not guaranteed. High energy and labor costs in the UK remain potential sticking points, as noted by unnamed sources. The viability of this partnership hinges on overcoming these economic challenges and aligning strategic priorities.
This collaboration could reshape the UK automotive landscape, but its success will depend on navigating complex economic and political factors.
